The Kerala High Court has recently delivered a judgment regarding pension calculations, bringing cheer to government employees, particularly in the context of implementing revised pensions for university teachers under the University Grants Commission (UGC) pay scale.
In a landmark ruling, the Kerala High Court has reaffirmed that pensions must be calculated based on revised pay scales, even when the pay revision is applied retrospectively.
This decision extends to pensioners who retired before the pay revision order, provided they are eligible for the revised pay scale.
Upholding an earlier order by the Kerala Administrative Tribunal (KAT), the High Court invalidated a government directive that limited the implementation of revised pensions for university teachers under the UGC pay scale to 2009, instead of the mandated 2006.
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Kerala High Court ruling
A Division Bench comprising Justice A. Muhamed Mustaque and Justice P. Krishna Kumar observed that “The law is settled that when the pay is revised retrospectively, that revised pay should be taken into account when calculating the pension, even if the pensioner retired prior to the issuance of the pay revision order, provided he is entitled to get the revised pay.”
What was the matter?
The case focused on a government order dated May 7, 2011, which revised the pay and allowances of college and university teachers under the UGC pay scales. It stated that teachers who retired on or after January 1, 2006, would have their pensions calculated based on the revised pay scale from that date. The formula for calculating pensions — 50% of the average salary from the last ten months of service — remained the same.
Later, the government issued a clarification stating that, since the UGC scheme does not specifically address pension provisions, the revised pension for UGC teachers would only be applied from July 1, 2009, to match the pension revision timeline for other state government employees.
The Kerala Administrative Tribunal set aside this clarification, citing the Supreme Court’s ruling in U.P. Raghavendra Acharya and Others v. State of Karnataka and Others (2006). In that case, the apex court rejected the notion that pensionary benefits linked to pay revisions for UGC teachers could be treated differently from those of other employees.
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